Anti Money Laundering Quiz

Fraud Elements

• Four elements of fraud: false statement regarding a matter, knowing the statement is false, reliance on that statement, and financial loss incurred.

Fraud vs. Attempted Fraud

• The primary distinction lies in the actual monetary loss; fraud involves loss, while attempted fraud does not lead to financial loss.

Money Laundering

• The process of making illegally obtained proceeds appear legal.

Financial Statements for Loans

• Businesses typically provide two key financial statements to secure a loan: balance sheet and income statement.

Balance Sheet

• A financial statement summarizing a company's assets, liabilities, and net worth at a specific point in time.

Income Statement

• A financial document reporting a company's revenue, expenses, and profit/loss over a specific timeframe.

Financial Crime Enforcement Network (FinCEN)

• A division of the United States Treasury Department, aiming to prevent and punish money laundering and associated crimes.

Currency Transaction Report (CTR)

• Required for any deposit, withdrawal, or exchange of currency exceeding $10,000 by U.S. financial institutions.

Suspicious Activity Report (SAR)

• Filed by financial institutions when there is suspicion of money laundering, fraud, or other legal violations.

Form 8300

• Must be filed by individuals in trade or business who receive more than $10,000 in cash in a single transaction.

Federal Reserve

• Central bank of the United States established in 1913, providing a stable monetary and financial system.

Bernie Madoff

• New York City hedge fund manager arrested in 2008; sentenced to 150 years for operating the largest Ponzi scheme in history.

Association of Certified Fraud Examiners (ACFE)

• The largest anti-fraud organization providing training and education in fraud detection and prevention.

Association of Certified Anti-Money Laundering Specialists (ACAMS)

• Largest international membership organization focused on enhancing knowledge in anti-money laundering and financial crime prevention.

Primary Financial Institution Regulators

• Federal Reserve Board, FDIC (Federal Deposit Insurance Corporation), National Credit Union Administration, Office of the Comptroller of the Currency (OCC).

Wall Street Regulators

• The two primary regulators are the United States Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA).

Largest U.S. Banks

• Notable banks include JPMorgan Chase, Bank of America, Wells Fargo, and Citigroup.

Evidence Acquisition by Law Enforcement

• Law enforcement may obtain evidence through subpoena, consent, or search warrant.

Joey Coyle

• Unemployed longshoreman who found $1.2 million on the street in 1981 after it fell from an armored car and decided to keep it.

Fraud Triangle (Fraud Pyramid)

• Contains perceived pressure, perceived opportunity, and rationalization that can lead to fraud.

Restricted Countries

• Countries prohibited from U.S. dealings: Libya, Iraq, Iran, Syria, Sudan, Somalia, Yemen.

Structuring Money Laundering

• Involves three stages: placement, layering, and integration.

Red Flags in Transactions

• A notable red flag is the lack of identification during financial transactions.

Bank Secrecy Act

• Enacted in 1970, it requires financial institutions to file transaction reports to assist in investigations.

Transaction Structuring

• The act of breaking up money orders into smaller transactions to evade reporting thresholds.

Office of Foreign Assets Control (OFAC)

• Government office that enforces laws regarding economic and trade sanctions against targeted foreign countries.

Specially Designated Nationals

• A block list maintained by OFAC that includes individuals and entities banned from U.S. dealings.

Exempt Countries from Sanctions

• Notable non-sanctioned countries include Canada, Russia, and the UK, among others.

Paul Manafort

• Known for his high-profile lobbying activities and subsequent indictments.

Beneficial Owner

• The individual who ultimately owns or controls an account.

Politically Exposed Person (PEP)

• An individual who holds a prominent public position, impacting their risk for involvement in corruption.

Test your knowledge on anti-money laundering concepts with this quiz. Explore key definitions and elements related to fraud and money laundering. Perfect for those studying finance, law, or criminal justice.